The Lead: Tesla closes above $200 for first time ahead of earnings report

Tesla Motors stock reached all-time highs yet again Tuesday, as Wall Street returned from a long weekend to an analyst upgrade ahead of the electric car maker's fourth-quarter earnings announcement as well as a report that CEO Elon Musk met with the head of mergers and acquisitions at Apple last year.

The Tesla Model S all-electric car and its charging station are displayed at the North American International Auto Show on Jan. 14, 2014 in Detroit. (Stan Honda/AFP/Getty Images)

After topping $200 in intraday trades last week for the first time, Tesla moved as high as $206 Tuesday and closed above the mark for the first time, gaining 2.8 percent to $203.70. Some analysts believes the stock is worth more, with Baird and Litchfield Hills Research analysts increasing their price targets Tuesday.

Baird analyst Ben Kallo increased his target price for Tesla from $187 to $215 Tuesday, explaining that he believes the company will announce higher sales totals than expected when the Palo Alto company releases its earnings report Wednesday afternoon, and could surprise with other announcements.

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"We believe several catalysts could drive the stock higher including 2014 delivery guidance, additional battery factory details, and a possibility for more info on a new production line," the analyst wrote.

Litchfield Hills Research analyst Theodore O'Neill bumped his price target from $188 to $222, predicting that Tesla's huge 2013 growth rate will slow in 2014, but cost savings from continued growth in production will help gross margins at a company he says is misconstrued by many investors.

"As long as there is a large group of investors who compare Tesla to a traditional automaker, the stock will remain undervalued in our opinion," O'Neill wrote. "We feel that investors underestimate the appeal of the Model S and the sales and service experience."

Other analysts contacted by Bloomberg pointed in another direction than price target increases for Tuesday's optimism, though: A San Francisco Chronicle report released Sunday that claimed Tesla CEO Elon Musk met with the head of Apple's head of mergers and acquisitions last year, sparking renewed rumors about a possible acquisition.

While the report caused a stir, it cited only a single, unnamed source on the meeting's occurrence, and did not provide any specifics about what happened beyond Musk supposedly meeting with executive Adrian Perica and "probably" CEO Tim Cook.

Analysts wasted little time in shooting down the possibility of Apple acquiring Tesla.

"(Steve Jobs') departure has left a big gaping hole even now with all the talent they have at Apple, so they would certainly look to collaborations and Musk certainly fits that bill," Misek told CNBC, mentioning Apple electronics appearing in the back seat of Tesla's upcoming Model X SUV as a possible target for both companies.

Wall Street moved very little overall Tuesday as traders returned from a long weekend, but Silicon Valley technology stocks enjoyed strong gains in spite of a drop from the second-largest tech company in the Bay Area, Hewlett-Packard.

And the widely watched Standard & Poor's 500 index: Up 2.13, or 0.12 percent, to 1,840.76

Check in weekday afternoons for the 60-Second Business Break, a summary of news from Mercury News staff writers, The Associated Press, Bloomberg News and other wire services. Contact Jeremy C. Owens at 408-920-5876; follow him at Twitter.com/jowens510.